The Next Entrant in the Shale Revolution?

Saudi Aramco, the world’s largest oil exporter, is set to join the shale revolution with plans to start producing unconventional natural gas this month and exploit a deposit that could rival the Eagle Ford formation in Texas.

Saudi Arabia’s gas resources from shale and other alternative supplies are “huge,” Khalid Al Abdulqader, general manager of unconventional resources at Aramco, said Wednesday in Manama, Bahrain. Production at the kingdom’s North Arabia basin will start by the end of March and reach its target by the end of this year, he said, without giving details.

Aramco is also drilling for unconventional gas in the South Ghawar and Jafurah basins, he said. Jafurah in eastern Saudi Arabia is similar in size to Eagle Ford, the second-biggest U.S. shale play for gas, Al Abdulqader said, without giving an estimate of the gas contained at Jafurah.

“It’s completely believable,” Robin Mills, chief executive officer of Dubai-based consultant Qamar Energy, said of the comparison. “Can they make a commercial proposition of it? That’s the question.”

Freeing Up Crude

State-run Aramco, formally known as Saudi Arabian Oil Co., plans to spend $300 billion on projects over the next 10 years to maintain its spare production capacity for oil and boost exploration for and output of conventional and unconventional gas, Chief Executive Officer Amin Nasser said in July. Any increase in supplies of gas drilled from shale and other hard-to-access rocks would free up crude that Saudi Arabia uses in its power plants, enabling the country to export the oil for a bigger profit.

Replies to This Discussion

Thanks for posting this for everyone to view. Saw it in another site yesterday.

It is safe to say that the Saudis have multiple unconventional reservoir options to pursue across their country. Several years ago, they had done some major exploratory drilling in the interior to test more conventional natural gas reservoirs - and reported had some very good success (all done with the idea of using gas for internal usage to free up more oil for export).

I believe that there are some very prolific unconventional resources in Oman right next door. And Jordan also has some legitimate unconventional resources that are presently being developed.

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